Have you gotten this phone call, regardless of where you are in your exit planning? During challenging, tumultuous times, this call comes from many corners. Some are legitimately interested, some are fishing, some are trying to take advantage. It may or may not be the right timing for your exit planning.
Over the last few months, we have heard from several business owners asking for help because they received “the call“.
When this question comes at you, it can be interesting, even exciting. How do you respond?
The best response is to ask for some basic information and let them know you will get back to them. Whether they say they are the potential buyer or representing the potential buyer, ask for their name, phone number, email address, and website. If you can’t get that, politely end the conversation. If they say they are representing another party, ask for the name of that person or company. They may not share this initially but ask. Getting some basic information will help you do some digging. It may be something like “I have buyers that are interested in your business.” If you hear that, consider ending the conversation! In any case, do NOT share any information, financial or otherwise, on this first call. Step back and consider your exit plan.
Even if they are legitimate, remember that they are representing the seller. This is a complex transaction, probably the most complicated one you will ever consider. It will impact your life, retirement, family, and employees for the long-term. Succession planning takes some time.
As I discussed in my last blog (Sell My Business Now? Wait for the Economy?), you need to consider so many factors when deciding if this is the right time for you to sell. It may very well be. Even then, you need experienced professionals who provide transaction services to help guide you through this most important decision and avoid the expensive pitfalls of trying to go it alone.
If you are ready to sell, get professional representation to help manage the process. A business sale is always complicated, even more so under current conditions. If you are not ready yet, start with an estimate of value and some advice on preparing your exit plan – whether your target is one year or 10 years. If you do have time, focus on getting through COVID-19 and building business value: Rebuilding Post-Crisis.
Call if we can help you think through your specific situation. Always happy to have a conversation to provide some guidance!
Stay Healthy & Safe!
David Shavzin
David Shavzin, CMC Exit Strategist – Value Growth, Exit Planning, Succession Planning, Transactions
From the mind of Don Turner – “Creating Clarity in a World of Complexity’
We are in our last installment of “Company Restoration in the New Normal.” I hope you are finding it informative and it is prompting some of your own thoughts about what to expect as we conduct business in this new world, we have found ourselves. Again, I invite you to leave comments on your thoughts so we can all learn together.
“The capacity to learn is a gift; the ability to learn is a skill; the willingness to learn is a choice.”
~ Brian Herbert
In Part 3 we introduced this mind map of the “5 C’s Restoration Strategy” and discussed the first three. In this final Part 4, we finish introducing the last 2 “C’s” and talk about the future.
5 C Restoration Strategy
COMMUNITY
“Alone, we can do so little; together, we can do so much”
~ Helen Keller
Your business operates within a community of Suppliers, Customers, Lenders, Local Government, and more. In “normal” times there is always a level of dependency with each member of this community. I know many companies like to talk about “partnerships” over “vendorships”, but the reality is that there is always a recognition that if needed there are options to replace one member of your community with another – i.e., the “law of supply and demand.”
Given the increased requirements of conducting business in the New Normal, you will be forced to have more detailed, more transparent, and more involved “heart-to-heart” discussions with everyone in your Value Chain. You will certainly need them to be accommodating to your liquidity pressure as they will require the same of you.
If there ever was a need for commitment over-involvement, the New Normal is the time.
With all due respect – and somewhat “tongue in cheek” – you and your business community need to embrace the “swine mentality.”
What does this mean?
For Suppliers associated with some form of fabrication, you may have to jointly work out the flow of raw materials with the flow of cash. As mentioned in the last installment, this will likely have several characteristics to it:
You may have to interactively negotiate cash flow terms between your Supplier and yourself and with your
Customer and yourself. This will require a level of trust
AND transparency that all parties are most likely not accustomed to. Expect to have honest discussions around “normal” margins and temporary New Normal margins – i.e., “I’m working at 20% less margin, can you sell to me for 20% less?” Who knows? In the short-term, you may have to “open the books” to negotiate with your Suppliers and Customers.
If – and that is a big IF – this is done successfully, would fully expect these relationships to evolve into strong “shared goal” partnerships as we evolve into later stages of the New Normal.
For service Suppliers, the challenges maybe even more difficult given that in tough times cutting back on outside services is typically one of the first burn rate reduction initiatives. With this in mind, there will be a renewed focus on monetarily quantifying your value-add to your Customer. This will be a rude “wake up call” for many Service Providers who have ignored this service-providing fundamental for way too long – i.e., paying “lip service” to it in promotional literature without routinely reviewing, refining, and enhancing their value to the marketplace.
You may have to provide a partial service to your Customers for a heavily reduced amount just to keep the business. In this case, you may have to significantly broaden your Customer base providing a narrower focus of services for heavily reduced prices.
All this said, with either fabrication or service Suppliers, I would expect that those business communities that survive and evolve into the New Normal to represent phenomenally stronger entities. This should serve them well in the future.
We addressed “Customers” as a stand-alone item in the 5C Restoration Strategy but it deserves some additional discussion in the context of your business community.
Customers should be open to discussing mutually beneficial arrangements where you can offer a temporarily reduced price and in turn, they will give you a long-term commitment to continue purchasing as the market becomes healthier. As with your Suppliers, you will likely have discussions that involve an entirely new level of transparency.
Again, everyone is simply trying to engage in commerce again. Communication, creativity, transparency, and commitment are the ground rules for the New Normal.
Lenders have always been willing to talk about helping in a distressed situation. Trust me, they don’t want to see you fail – costs them money, time, and a whole lot of paperwork. In the New Normal, there may not be much new capital available through traditional lending institutions (ED: we will briefly address the role of Private Equity at the end) but that is likely not your issue. Early in the New Normal, businesses will most likely be looking to “buy time” in dealing with existing institutional debt.
Relative to new lines of credit, I don’t see this as an impossibility if the Lender is brought into the interactive and integrated discussions that you are having with your Suppliers and Customers. At the risk of repeating myself ad nauseam, this will require complete transparency and a commitment by all members of your business community to work together. “Good and Services” move on the current of “Cash Flow.”
COMMERCE
“When only one party makes a profit that’s robbery; when all parties make a profit that’s business.”
~ Amit Kalantri, Wealth of Words
Last but not least is the business itself. An involved topic but the key points are:
New Normal Marketplace Ground Rules – you must take an honest, fresh look at your value proposition into the marketplace. Think through the real value your offering has to your Customers. If you can’t answer the following four questions succinctly then you have a true “value proposition problem” with your business:
“Why should the Customer listen to you?” 2. “Why should the Customer listen to you now?
“Why should the Customer buy from you?”
Why should the Customer buy from you now?”
There is a “brave new business world” coming via the New Normal and I see only quantifiably value-offering businesses surviving, much less thriving.
SHORT-TERM GAME PLAN – the first step in your Restoration is to deal with all of the aforementioned. In addition, have a Restoration Game Plan that you look at EVERY day, THROUGHOUT the day. Each day should involve laser-focused attention to balancing:
Delivery Cycle Excellence – if your offering is still relevant in the marketplace then there will always be Customers for those who can deliver real value quickly, cost-effectively, and with superior quality.
Liquidity Management – in the early stages of the New Normal, liquidity hiccups can be deadly. Constant vigilance and constant communication backward and forward in your Value Chain is critical.
Culture – remember your employees are no longer coworkers. If you have made the management to leadership transition effectively they are your “Battle Buddies”, your
LONGER-TERM GAME PLAN – obviously the longer we look into the future the less clear our “crystal ball” will be. However, looking into the future is something we all must do – the alternative is to face the professional ignominy of being a “Reaction Manager” versus a “Proactive Leader.” Note, this “looking into the future” is where the art and science – and trust me it is clearly both – of Strategy comes into play.
The fact is that we may not make strategic decisions daily, but in a lifetime of developing and executing strategy, I guarantee you that you are exposed to “strategically-relevant” information EVERY day, throughout the day.
If you don’t have the processes and tools to capture in real-time you should at least set aside some time at the end of every day and ask yourself, “what did I learn today that may impact my long-term direction at some point in the future?” This observation can involve the market in general, Customers, Competitors, Offerings, or the underlying technology that is part of your marketplace. Sometimes it is nothing more than a “tidbit” of news – you need to learn how to identify “potentially” important strategic data (ED: it is a sad testimony to our Business School educational system that many professionals have never been taught to be “Strategic Thinkers”).
An additional observation based on a little bit of experience on the topic is to understand what is becoming LESS important in the marketplace. Many professionals only try to understand the emerging or growing trends – remember how we said that is the “essence” of strategy – and that is a good thing. However, what is often ignored from a resource planning perspective is also trying to understand what is becoming less important. It is amazing how many times I have found organizations still investing significant resources – time, personnel, and capital – on items that are becoming less relevant in their marketplace.
Bottom line, the objective is to gather and organize strategic information in a way that it is useful when you formally sit down with your Team to refine your strategy – whether that be monthly, quarterly, semi-annually, etc. (ED: timing is a function of the “velocity” of your particular marketplace).
“It’s amazing how a little tomorrow can make up for a whole lot of yesterday.”
~ John Guare, American Playwright
FINAL RANDOM THOUGHTS
Given that in recent years I have worked with a lot of Private Equity organizations, a comment or two about how they will play and play into the New Normal seems appropriate.
First and foremost, they will be laser-focused on the survival of their current portfolio companies. They always hold back extra capital – i.e., “dry powder” – to further invest in their portfolio companies when either things have not gone as planned or there is an opportunity to grow even faster. Obviously, nothing prepared them for this economic calamity of a global scale. It is likely that some “fire sales” will be taking place as they identify portfolio businesses that simply aren’t relevant in the New Normal and need to be jettisoned.
That said, once their portfolio is relatively stabilized, expect them to be on a “rollup” frenzy – where a “rollup” is when an investment firm buys multiple smaller companies in the same market with the intent of developing economies of scale and becoming more of a dominating force in that particular marketplace. With the expected business casualties of the New Normal, it is likely to be what we refer to as a “target-rich environment” for buying distressed companies.
As a business professional, it would be to your benefit to follow these rollup activities and look for opportunities for your own business. Ahhh, but that is a topic for another day.
SUMMARY
As we come to a close on our look at restoring companies in the New Normal, let us review what we discussed:
We are NOT going back to normal, there will be foundational changes in our society, our culture, and the manners of how we conduct commerce.
Surviving – much less thriving – will involve far more involved techniques than normally associated with “Restructuring” or “Turnaround” – though the actual stages remain the same
Successful business Restoration will require innovative approaches to managing Cash, Customers, Culture, Community, and Commerce itself
So. we are headed for a New Normal – of that, I have no doubt. Here is to hoping that we can use these “interesting times” to our advantage and make a better world for all.
Particularly in challenging times, success is NOT about knowing the answers to tomorrow – few have that prophetic ability.
Future success is based on asking the right questions today.
Good luck. May you and yours be safe and healthy.
Don Turner, 24 Apr 2020
Don Turner
Don Turner is a serial growth and turnaround executive with success in a broad range of marketplaces and business situations. He is also an internationally recognized Strategist who has deployed his VOGI® Strategy Methodology in over one-hundred organizations ranging from startup to NYSE and NASDAQ public companies. Routinely called in to deal with some of the most difficult business problems, one executive summed it up as, “everything Don touches is better as a result.”
From the mind of Don Turner – ‘Creating Clarity in a World of Complexity’
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In Part 1, we identified some of the more important characteristics that will be driving the New Normal. In this discussion, we will focus on how business professionals should be looking to respond to the New Normal.
First and foremost, it is clear that many companies are and will be faced with survival, pure and simple – doing whatever they can do today to ensure they are in business tomorrow. This is a reality that must be dealt with. Some will make it, many won’t.
That aside, if the company has enough “liquidity runway” to reenter the marketplace than the question is “how?” As we return to the world of commerce, it will be clear to all involved that is not going to be “business as usual.”
Given the current situation, the natural tendency is to turn to the methods that fall under the topic of “Turnaround” or “Restructuring” in an attempt to return a company to prosperity. Even so, I believe we will quickly find that these traditional ways of “fixing” organizations are insufficient. I believe these Restructuring/Turnaround approaches must be modified and evolved to reflect the realities of conducting business in the New Normal.
To differentiate this new perspective,
I’m suggesting that conducting commerce in the New Normal will require a “Restoration Strategy” mindset. We aren’t simply “restructuring” companies, we are “restoring” them to going entities. We aren’t simply “turning around” companies, we are “restoring” their business models modified for the realities of the New Normal. Restoration will require answering questions, developing approaches, and executing tactics that have never been part of a “typical” Restructuring or Turnaround effort.
I’m suggesting that the fundamental difference between Restructuring and Restoration will be the underlying environment. In a Restructuring situation, the company itself is distressed. In a Restoration environment not only the company, but it’s a marketplace – Customers, Suppliers, Lenders, everyone – are distressed also. This extra level of calamity will force us to conduct commerce in entirely new ways with new levels of focused cooperation.
TYPICAL RESTRUCTURING
To understand the concept of “Restoration” – which builds on “Restructuring” and “Turnaround” methodologies, let’s make sure we understand what is typically involved with the Restructuring/Turnaround.
Please note, we are taking the concept of “Workout” out of the equation here. In my distressed company lexicon, a “Workout” is when a company is already in or close to some form of receivership and it is likely no longer a going concern. In this case, the focus is working with Banks and Creditors to maximize asset monetization. Workouts in the New Normal will clearly be common, but the focus of this article is with businesses that have the potential to restore themselves and prosper.
In contrast – as someone who has been involved in a few turnarounds over the years – I view a Turnaround as a situation where the company is distressed and clearly in trouble but there is a possibility of “fixing it” and making it a healthy, growing concern again. I would be the first to admit that it doesn’t always end that way but the difference is the intent going in. That intent drives what you immediately do in a Turnaround situation.
As a common discussion point, let’s all reacquaint ourselves with “Turnaround 101” by discussing the four major stages – as shown in the following exhibit:
Let’s briefly review each stage.
Stage 1 – TRIAGE – this first stage is the most critical and essentially represents a “GO” or “NO
GO” decision. You must quickly assess the company in terms of liquidity, resources, operations (ED: “processes”), and its marketplace. Note, a comment on this last item. Some turnaround efforts ignore an effective look at the marketplace and after fixing the company find out that it should not have been fixed in the first place because of an unattractive market based on size, growth, competitors, profitability, etc. – i.e., remember to look at the external marketplace during Triage. Back to this initial assessment, you are trying to answer the question, “do I have something worth saving as a going entity?” Your focus is on items such as liquidity, burn rate, and Customer communication (i.e., read “retention”). The bottom line, you are focused on what we call “stopping the bleeding.” Further, what is often not realized is that in this early stage of triage, you must simultaneously start developing a “vision” for the future of the Company that can be communicated to Customers and Stakeholders (i.e., employees, board, investors, creditors).
Stage 2 – STABILIZE – this second stage is focused at creating consistency and predictable operations – particularly in terms of burn rate. That is Revenue less Expenses on a cash basis. One of the fundamental tenets of Japanese Total Quality Management developed back in 1954 is that to “fix something” you must do whatever you are doing – no matter how badly you are doing it – in a consistent manner. Starting your “fixing”, your initial focus is outward-looking – repairing/improving any and all Customer-facing activities such as product quality and delivery. At the same time, you communicate to Customers the actions you are taking to assure them of the company’s health and ongoing vitality. Internally, you concentrate on those items in the “Delivery Cycle” – specifically Sales, Delivery, and Customer Service. Generally, these can all be fixed relatively quickly. As the “Delivery Cycle” is stabilized you can then later turn your attention to the “Development Cycle” that includes Marketing/Development/Engineering (ED: this latter cycle has a slower “velocity” or “cycle time” and requires more time to change). In stabilizing the company, your greatest focus is on those items that can make an immediate, positive impact on Cash, Customers, and Delivery. During this stage, you also begin communicating the “vision” that was developed in Stage 1 to Customers, Shareholders, and Employees. Particularly with Employees, you must encourage your top employees to stay and embrace the vision (ED: in a typical distressed situation your best employees most likely already have their Resumes “on the street.”)
With Vision, there is clarity of purpose. Without Vision, there is chaos of existence.
Stage 3 – PROFITABILITY – If you have effectively stabilized the company to some form of consistency than the next stage is focused at profitability – generating EBITDA and a cash stream that ensures sustainability. There are countless techniques Turnaround Professionals use – dependent upon the situation – but some of the more obvious ones might include: product line rationalization, Customer attractiveness prioritization, revenue-generating Customer service, alternative Delivery approaches, cycle time reduction, product testing improvement (ED: product quality may take longer), etc. At this stage, you are also starting to work the “Development Cycle” including the product roadmap for new offerings that might be more attractive to your Customers. The bottom line, at this point you have a going concern and your next focus is how to put the company on a healthy growth track.
Stage 4 – GROWTH – with a going, profitable, concern you are now looking more strategically to the future in terms of markets and offerings. You are addressing questions such as: “Do I have the right offerings and business model for my current market”; “What else can I sell to my current Customers”; “Can I use my offerings or core competencies to expand to other markets” – i.e., generate new Customers. Generally, most of these questions all fall under the auspices of the Ansoff Matrix – which represents an effective framework for identifying growth/risk opportunities (ED: have used this framework dozens and dozens of times to help identify, evaluate, and select growth initiatives for an organization). The final, bottom line “big question” is “What company focus – i.e., “strategy” – will generate the maximum return for the Investors?”
These are the basic stages of a typical Turnaround. Given the many possible problems and the many possible solutions, Turnaround approaches are almost always modified as needed for a specific distressed situation.
HOW IS RESTORATION DIFFERENT?
What is different about a “Restoration” versus “Restructuring” as it relates to the New Normal? The actual stages of a Restructuring remain the same, but the underlying conditions are significantly more formidable – creating greater requirements and likely entirely new requirements to successfully “restore” the company to a healthy status. You can think about these requirements in four major categories – Environment, Personnel, Liquidity, and Emotional Intangibles. I am sure we could address more, but let’s focus on these for now.
ENVIRONMENT – as mentioned, in a typical Turnaround the Company is in a distressed state whereas in the New Normal almost every business surrounding the Company will be in some form of distressed state – i.e., everyone is “in the same boat.” The good news is that everyone around the table will be acutely more focused and amenable to “making something happen.” This reminds of the quote from the 18th century English writer, Samuel Johnson, who said;
“Depend upon it, sir, when a man knows he is to be hanged in a fortnight, it concentrates his mind wonderfully.”
The environment in the New Normal will be characterized as a fierce determination to survive that will force business professionals to develop and consider new approaches to keeping their business alive – particularly through the early stages of the New Normal. Expect less long-term relationship development – “survival timing” simply won’t allow. Discussions between marketplace partners will be one of “putting your cards on the table” and asking “what can we make happen between us that will be a win-win?” Golf course discussions will become lifeboat discussions.
PERSONNEL – in a normal Turnaround situation your best employees have ample opportunity to go elsewhere – that is why they are your best. However, in the New Normal their prospects of leaving are diminished – that is the good news. The bad news is the increased challenge to motivate people when they feel they are “trapped.” That said, I envision this as an opportunity to build an esprit de corps in your company culture like never before. In our next installment where we discuss “Culture”, we’ll explore this a bit more. Suffice it to say that the New Normal will create the “potential” environment where coworkers become akin to “battle buddies” and all that implies – ask anyone who has been in armed conflict about this significance. Note, an important point is that leading battle buddies will require a far more effective leadership than supervising coworkers.
LIQUIDITY – in the New Normal everyone has limited liquidity, not just you but your Customers, your Suppliers, Your Lenders, etc. Everyone wants to conduct business but everyone also has limited buying power to purchase goods and services. Surviving and then prospering – relatively speaking for at least the short-term – in the New Normal will require creative ways of using limited capital to conduct business. I fully envision the barter system to be resurrected for certain types of transactions – particularly in the service sector – as well as creative consignment approaches for getting product in front of potential buyers. Payment terms will have to be negotiated almost simultaneously along the entire supply chain.
EMOTIONAL INTANGIBLES – by their very nature normal Restructuring efforts place tremendous stress on everyone in the business. Be that as it may, in Restoration – under the New Normal – we can expect a higher level of emotional stress throughout the organization than we have never seen before. The options we face under the New Normal are limited and with limited options comes an accompanying realization that this is truly a “do or die” situation. Decision-Makers will agonize over their choices more than they ever have – as will everyone in the organization whose livelihood is impacted by those decisions.
As we can see, these underlying factors of the New Normal will place tremendous pressure on every business professional to get creative. I believe one positive outcome – and I actually think there will be many – of these pressures is for a greater level of transparency in transactions between parties. The urgency of “restoring” business in the New Normal simply will not allow for the typical “games” often found during the sales and negotiating activities.
In many ways, the Restoration of companies in the New Normal can be viewed as “Restructuring on Steroids.”
What should businesses do in trying to respond to the New Normal? In Part 3 we’ll discuss some thoughts about specific actions.
Dpm Turner
don@turnerworld.com
678.361.3313
www.turnerworld.com
Thank you for visiting our blog.
Jim Weber – Managing Partner, ITB Partners
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Longtime community leader brings four decades of management experience, including in the hospitality industry.
Barry Flink
Barry Flink, executive vice president and partner of Flex HR, Inc., has been named to the advisory board of Departures Magazine. The publication is a source for high-end travel, restaurants, hotels, and fashion, shopping, art, and culture.
Flink has 40 years of management experience in multiple industries. His favorite jobs have always been in the hospitality industry. He has held senior-level management positions in Westin Hotels & Resorts, InterContinental Hotels, Service America Corporation, the Greyhound Corporation, and the Peasant Restaurants, Inc., based in Atlanta. He began his career in the hospitality industry as the Hyatt Hotel Corporation’s first national management trainee.
Flink is also an executive in residence at Kennesaw State University and has served on the board of directors of Georgia Tech’s College of Management as well as KSU’s Coles College of Business. He has also served on the President’s Advisory Board of Oglethorpe University.
He has been a visiting lecturer at Cornell University, Washington State University, Florida State University, Georgia Tech, Georgia State University, Emory University, and the University of Guelph and Ryerson University in Canada. He also wrote a chapter for a college textbook, “Business Acumen II.”
Flink was board chair of the Edge Connection and has served on the Small Business Council of the Metro Atlanta Chamber of Commerce, the board of directors of the American-Israel Chamber of Commerce, and an advisory board of Saint Joseph’s Hospital.
Successfully-Returning-To-Workplace: by Jim Cichanski and Jamie Sieja
The past few months have been unpredictable as the pandemic has taken a toll on most businesses. Almost all small to midsize companies have learned to adapt to these arbitrary and varying new working environments. However, it seems the change is actually going well for workers. 57% of U.S. employees think COVID-19 has changed the way we work for the better.*
Workplace Flexibility Moving Forward After Coronavirus
Therefore, it’s time to start looking ahead and getting businesses back on track by implementing updated work policies as the economy restarts. It’s imperative that Human Resources communicate their restructured plans to ensure a healthy and safe operational environment. Jim Cichanski, CEO of Flex HR states “we are working with hundreds of clients to bring back the workforce into their offices. The one key message I urge companies to convey to their employees encompasses the measures you are taking to keep them as safe as possible upon returning to the office. Conversely, be careful not to over promise-keeping your workforce completely safe. The research is still unclear as to exactly how an individual can catch, and spread, COVID-19; therefore, there is no way to create a perfectly protected environment while at work.” While some organizations have begun opening their doors for staff to return to physical locations, the majority of businesses are acclimating toward a remote workforce. Consequently, this means companies are fully transitioning to flexible working arrangements in the foreseeable future.
“If workplace flexibility is an expected employee perk, then employers will continue to offer that benefit to hire and retain quality people, which should be a prime the goal of the employer,” says Karen M. McGrath, assistant professor of finance at the Freeman College of Management at Bucknell University. “So as long as productivity remains strong, and employees experience greater job satisfaction, then I do not see things changing.”
Employers and Staff Returning to the Workplace
“HR executives should be the leaders in transitioning employees back to the workplace,” says David Osborne, chief executive officer of Virgin Pulse, a wellness company. Several employers are phasing employees back into offices, staggering workdays, moving office spaces (or cubicles) 6 -10 feet apart, and conducting temperature screenings before entering the building. Furthermore, other companies are asking their workers to self-administer temperature checks at home and attest that they have no COVID symptoms before entering their workspace each day. All of these transformations throughout the organization need to be relayed to all employees to ease their anxieties and to provide peace of mind. In short, companies are being trusted by their employees to do the right thing, follow the right guidance, and bring them back safely.
Overcoming New Office Challenges During The Pandemic
As the impact of Coronavirus across the country is lingering, one new challenge that organizations are experiencing is navigating day-to-day productivity efficiently. Thus, it’s essential to design a return to work plan that is sufficiently adaptable to evolving recommendations, guidelines, and orders issued by federal, state, and local governments, such as the Families First Coronavirus Response Act (FFCRA). Additionally, employers should reference guidelines published by the U.S. Centers for Disease Control and Prevention (CDC) and the Occupational Safety and Health Administration (OSHA), which summarize key considerations for preparing workplaces when bringing back employees.
Human Resources Is Vital Right Now
Business owners need to invest in the proper HR expertise now more than ever to successfully strategize and manage the modifications of new office policies. Businesses around the nation are trending towards outsourcing their human resources. Companies like Flex HR, Inc., a full-service HR firm headquartered in Johns Creek, GA, oversee these adaptable transitions all while mitigating possible liability risks for the employer. HR professionals have become the principal leaders of positive change; inventing new ways to work, altering job functions, developing new learning and communication methodologies. “The HR profession has taken on a heroic role. I am more inspired and energized to support the HR profession than ever. HR leaders are rolling up their sleeves, partnering with IT, facilities and legal functions, and figuring out how to react, respond and re-engineer all aspects of work,” notes Josh Bersin of Human Resource Executive.
Streamlining business complexities during the COVID crisis is perplexing in itself. Leadership is currently overwhelmed in making effectively-balanced valuable decisions for both staff and the organization. Simultaneously all while trying to enforce the company’s core values and safeguarding the well-being of employees. To ease the burden of management, HR companies, like Flex HR, have created “helpful tips for managing the Coronavirus crisis” online, specifically addressing COVID-19 business impact concerns. For checklists, sample return to work letters, and other essential information for having your staff return to work, contact Flex HR now.
Jim Cichanski, the founder, President, and CEO of Flex HR, Inc., has 30+ years of experience in human resources, holding senior-level positions in companies that were privately held, pre-IPO, foreign-owned, joint venture, Fortune 50 and one labeled the “fastest-growing F1000 in America.”
Jim Cichanski Flex HR, Inc. President and CEO Flex HR, Inc.
Thank you for visiting our blog.
Jim Weber – Managing Partner, ITB Partners
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Today’s employees are facing unprecedented levels of stress both personally and professionally.
Employee Engagement
In many companies, employees face uncertainty and perhaps a furlough, layoff, or pay reduction due to the economic impact of the pandemic. In other companies, where the demand for their service or product suddenly increased (PPE products, telemedicine software, or video conferencing) employees find themselves overwhelmed with excessive hours week after week, perhaps in addition to now having to home school their children. And then there are the essential employees that have been asked to risk their own health to meet the new societal demands brought on by the pandemic.
Every day, we are reminded of the toll the pandemic is playing on employees. You can hear it in employees’ conversations and see it play out live on Zoom conference meetings. The daily news is filled with employees’ reactions to their company’s actions in response to the pandemic. Some companies like Amazon and Google made national news as employees expressed concerns to the press.
How employers treat their employees and how employees perceive their company during this challenging time will have a long-term impact on employee engagement levels for years to come. We saw proof of this in the years that followed the 2009 financial crisis. During that crisis, many companies failed to demonstrate compassion and their actions did not facilitate trust. As companies focused on the economic downturn, they failed to take steps to keep their employees engaged. As a result, many companies experienced decreased productivity, reduced customer satisfaction, and higher levels of attrition for years after 2009. Similarly, their brand was impacted for years to come as potential new hires used social media and networking to uncover past employees’ perceptions of their employers.
Organizations that take steps now to prevent a long-term disengaged workforce will reap benefits not only in the short-term but for years to come after the pandemic is history. Even as companies work hard today to contain costs, there are a number of simple, low-cost actions all employers can take to keep their workforce engaged.
High Impact, Low-Cost Employee Engagement Actions
Ensure alignment of the leadership team. Senior leaders set the tone and are responsible for making sure all managers model the tone and deliver consistent messaging.
Constant, transparent communication with employees is key, especially in trying times. Companies can keep employees informed through various channels, including corporate-wide virtual meetings, manager 1:1 meetings, and electronic updates.
Develop a culture and expectation that all managers check-in with their employees on a regular basis. By checking in with employees and listening, managers will develop an understanding of each employee’s concerns, needs, and goals.
Establish and communicate the go-forward vision for the company so employees can understand and support the vision.
Create an informal or formal mechanism to take the pulse of employees. Then ensure senior management receives this important feedback and as needed, takes actions in response to the feedback.
Regardless of the specific impact the pandemic is having on your business, the key to successfully and rapidly getting back on track at the back end of the pandemic will in a large part depend upon your workforce. By focusing on these employee engagement best practices, employers will foster a culture where employees are motivated to help the company achieve its goals. An inspired workforce will work hard to achieve productivity and sales goals. A disengaged workforce will complain to customers and resign when the job market picks up. Given the strong link between an engaged, motivated workforce, and corporate success, there has never been a better time for companies to focus on employee engagement.
Anne Gildea-Olt
Anne Gildea-Olt is the managing member of Strategic HRM Solutions, LLC., an HR consulting firm committed to helping companies successfully navigate change, accelerate growth, and deliver proactive innovative human capital solutions.
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Growing up on a small farm in South Georgia, I learned at an early age there were laws that governed the growth of crops and animals. Now as an adult I hear everyone talking about growing a business, growing a family, growing a political party, growing a church – it seems like everybody is trying to grow something!! It has occurred to me that the Laws of Growth I learned on the farm about growing an organism might also apply to grow an organization.
The First Law of Growth is that Growth is the NATURAL RESULT of a healthy organism. We did not go out every morning and wake the cows up and encourage them to grow! We kept them fed and watered and they just grew! For those of you who have children, you never had to go in the baby’s room and tell Junior it was time to start stretching so he would grow! You just had to keep him fed and watered and he grew!
May I be so bold as to suggest that if we have a healthy organization, it too will naturally grow? If we build an organization where people want to work and contribute, they will not want to leave and will become a brand ambassador for other people looking for a healthy work environment. And our clients and customers will benefit from their loyalty and will want to purchase as many of our products and services as they can use, and they too will become brand ambassadors for others needing what you provide!
So how do you go about creating that healthy organization?
The Second Law of Growth is you must Plant the Seeds to Reap a Harvest. You can’t just lay the seeds on top of the ground and expect to reap anything on the farm, and you can’t just talk about what you’re going to do, you must actually DO something!
You have to break up the fallow ground, plow it up, loosen the soil, allow it to breathe and accept rainwater! When is the last time you took a long, hard look at how you do what it is that you do? How long have you been doing the same old thing the same old way? Are there parts of your organization that needs the refreshing of a good plowing?
Now, this is not the “just change something to be changing” mantra, but would any of your key people benefit from some additional training or a motivational seminar? Are there processes that could be changed to produce better outcomes? Would it help to have a consultant or outside advisor come in and give your organization a complete evaluation top to bottom? What would happen in your organization if you pulled your salespeople into work in operations and sent your operations people out to make sales calls – even for a short period of time?
It has been said that a RUT is just a grave with the ends knocked out and ruts can be deadly in an organization if not plowed up!
The Third Law is you REAP what you SOW! This could be a book in itself! You will reap the ATTITUDE you sow! You will reap the employees you hire! You will reap the character you develop! You will reap the policies you implement!
On the farm, it didn’t cost much more to purchase the BEST seeds, and, in the long run, they always gave the best yield. Might I propose that hiring the best people will, in the long run, be your best bargain? Hiring less than the best is a false economy – you will always get what you pay for!
The Fourth Law is that your Harvest is directly proportional to the care you provide your crops. You have to make sure your plants are receiving adequate water and fertilizer, and your employees must be receiving adequate compensation and training! Your clients and customers must be receiving high-touch relationships and quality products and services! Start being stingy and your organization will react.
The Fifth Law is you must PULL the WEEDS! If there is someone in your organization that is not contributing, either motivate them, train them or fire them. If there is anyone sowing discord, fire them immediately. Crops cannot compete with weeds for water and fertilizer and your employees are not going to thrive with negativity in their world. And dare I say sometimes a client or customer can become a weed. Don’t be afraid to fire one of them if they are creating more problems than they are worth.
The Sixth Law is you will always reap MORE than you sow! For every seed of corn you plant, you will reap 2 to 4 EARS of corn come the harvest! There should be a positive ROI on every employee and every customer, and that ROI is going to be influenced by how well the leader leads. Unfortunately, this law also works in the negative – reaping more grief than was sown.
The Seventh Law is you reap LATER than you sow! There is no magic wand to instantly create a healthy organization. It takes time for the efforts you put in to produce the results you are wanting, but don’t let that discourage you from starting the process. Consider it motivation to start NOW! Get a sense of urgency about creating a great organization.
So, in closing, I recall the words of Kevin Costner in The Field of Dreams, you build a healthy organization and they will come! Employees will come! Clients and customers will come! Profits will come!
Ralph Watson
Ralph Watson has a varied and extensive career spanning 45 years of increasingly responsible positions in both sales and operations in a very diverse mix of industry specialties, including food processing, textile and apparel, financial services, and professional management consulting.
Ralph served as a Senior Executive Analyst with a number of international consulting companies focused on the family-owned, privately held market where he distinguished himself as one of the top analysts in a highly competitive field. In early 2014, he personally coached 10 businesses in Europe.
Ralph C. Watson, Jr. 404-520-1030
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Bottomline First: Owners don’t really have anyone to talk to about their problems. Reach out to those in your care.
Outside of a preacher in a small church, I don’t know of a more lonely calling than a small business owner.
I will often ask them, “Do you know what your friends think of you?”
They look at me with stunned incredulity since I had only met them a couple of hours earlier and know none of their friends.
I proceed to tell them, “Your friends think they have it made, they think you come and go as you please, hire people to do what you don’t want to do and write it all off on your taxes!! They think you have the Life of Riley!”
Then they say, “You know, you are absolutely right!”
And I assure them if they try to convince their friends just how hard it is owning a business, they think you are pulling their leg!
And THIS is during the GOOD times! The loneliness is only getting worse in the economic environment of the day!
Many times business owners will become overly friendly with their employees to cope with their isolation knowing they get the day-to-day stresses with which the owner is dealing. But that becomes a management problem within the business and makes it almost unthinkable to furlough them when times get tough.
Business owners are seen as “having it all together” not only by their friends and the public at large but also by their families. I can’t tell you how many times I have interviewed a business owner during an analytical survey of their company who was showing a loss on their P&L only to discover he (or she) had not told their spouse. And let’s be honest, men, we are more guilty of this than our sisters-in-business. That stinkin’ EGO of ours gets us in trouble and then cuts off the support we so desperately need!
So to you advisors of these stalwart but hurting heroes of our economy, reach out to them! They need to know there are people and places that can be safe for them to unmask their pain.
Bankers, attorneys, wealth advisors, CPAs, insurance agents, consultants, accounting firms, HR firms – any trusted advisor in their life can just BE THERE for them and let them know it is OK for them to share anything that is bothering them.
If you are in a role they might not feel comfortable due to the business relationship (like their banker), try suggesting they might want to talk to a friend of yours.
As Charles Dickens wrote in the Tale of Two Cities, “It was the best of times, it was the worst of time…” We have been brutally snatched out of “the best of times” and forced into what is arguably “the worst of times.”
As a man of faith, I would that all men and women would seek guidance from the Creator of us all to lean into Him and His wisdom for our individual and corporate deliverance.
Let’s all be there for each other as we walk through the valley of shadows.
Ralph Watson
Ralph Watson has a varied and extensive career spanning 45 years of increasingly responsible positions in both sales and operations in a very diverse mix of industry specialties, including food processing, textile and apparel, financial services, and professional management consulting.
Ralph served as a Senior Executive Analyst with a number of international consulting companies focused on the family-owned, privately held market where he distinguished himself as one of the top analysts in a highly competitive field. In early 2014, he personally coached 10 businesses in Europe.
A prudent man foreseeth the evil, and hideth himself (or ‘seeks refuge’): but the simple pass on, and are punished. Proverbs 22:3
Ralph Watson
Regardless of where Covid-19 originated, it is an actual virus and it is among us.
Mass hysteria has gripped our country emptying our grocery stores and gun shops and tanking our economy. I’m not making a political statement nor placing blame. I am simply acknowledging the current reality of our world and the tragic effect it is having on our businesses, large and small.
Let me invite you to step away from the madness for a few minutes for a dispassionate chat about our current situation.
At this point, there is precious little we can do with the country on lockdown. Our customers are not circulating in the marketplace, but are rather cocooned in their homes possibly shopping online. That doesn’t mean we can’t do ANYthing!
In his seminal book, The 7 Habits of Highly Effective People, Stephen Covey presented his Time Management Matrix exposing the relationship between Urgent tasks and Important tasks.
Quadrant I was the “Urgent & Important” containing all the fires that business owners face all day long: operational breakdowns, customer complaints, employee disagreements, accounts receivables, job bidding, and the list goes on ad infinitum! This is the quadrant in which we spend most of our waking business hours.
Quadrant II was the “Important but NOT Urgent” containing – honestly – all the most important issues of life: date night with the spouse, children’s ball game or dance recital, thinking & planning, reading important literature, praying or meditating, taking care of our health and on it goes.
The paradox of these two quadrants is that the ONLY way to get Quadrant I under control is to camp out in Quadrant II and DO the Important work of strategic business planning and management self-improvement! As you are able to become proactive and look down the road to see potential dangers, you are able to make those provisions to avoid the fires and reduce the size and tyranny of Quadrant I.
Although this may be the first time our current living generation has seen what is happening, it is not the first time for our country. Let me acknowledge that during the Great Depression, there were bakeries that went out of business – but there were bakeries that survived. There were clothing stores that went out of business, but there were clothing stores that made it.
The point is that no business segment vanished. Some businesses in every category made it in spite of so many of their competitors folding for good. So while we are all currently forced out of Quadrant I, now is a great time to take full advantage of the situation to get seriously deep into Quadrant II and not squander this unique opportunity to Be Greater Faster!
Read a management book. Call friends who own businesses to talk about common issues. Engage with a professional consultant – a generalist if you need overall help, or a specialist if you feel you need specific help like marketing. Reconnect with distant family. Get spiritually recentered.
Now maybe a good time to do a deep clean on your business. If you own a restaurant, pull all your equipment from the wall and clean behind that greasy frier and refrigerator. If you have inventory, get it straightened up, pull inactive SKUs and sell them off online if you can. Take a close look at your shop floor to see if there is a better way to improve the flow of production.
Now is NOT a time for deer-in-the-headlights paralysis!
If you need inspiration, reach out to someone you can trust!
Ralph C. Watson, Jr. 404.520.1030
Ralph.Watson@BeGreaterFaster.com
Thank you for visiting our blog.
Jim Weber – Managing Partner, ITB Partners
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This is a difficult, even unprecedented time. There is great uncertainty, and many are fearful. Some are suffering through this alone. Thankfully, this pandemic comes at a time when our technology makes forced isolation bearable.
In difficult times the American Spirit shines brightest because we face our challenges together. Given the strength of our relationships, the value we place on one another, I am confident that we will overcome this scourge. We may be bruised, but we will emerge stronger.
From a personal perspective, I believe my life’s mission is to help however I can. My goal is to focus on what I can control and avoid dwelling on issues beyond my control.
I know that my core strength is helping people navigate the new normal for employment and career management. In many respects, this was the genesis of ITB PARTNERS.
I want you to know that I am here to help you. In fact, I am happy to offer my services free of charge to help you through this difficult time.
There are many things we can discuss, but I may be most helpful in the following areas:
Navigating the quarantine.
Developing a Personal Recovery Plan.
Maintaining relationships with your customers, clients, and network.
Viable Job Search Strategies.
Key considerations to anticipate from the recovery.
Significant trends to consider in your planning.
Evaluating options and setting priorities.
How to start a business.
Ultimately, I’m available to talk with you even if to bounce around some ideas or offer introductions from my vast network.
So, here’s my offer:
If you would like a free 30-minute consultation, email Jim.Weber@itbpartners.com with this subject: “I Want to Schedule a Free Consultation.” I will respond back with my calendar tool to schedule a telephone or video call.
I hope you find this useful and will schedule a call. If nothing else, I would enjoy an update from you to know how you are coping.
Best wishes for your continued health and safety.
Thank you for visiting our blog.
Jim Weber – Managing Partner, ITB Partners
I hope you enjoyed our point of view and would like to receive regular posts directly to your email inbox. Toward this end, put your contact information on my mailing list.
Your feedback helps me continue to publish articles that you want to read. Your input is very important to me so; please leave a comment.
Again, everyone is simply trying to engage in commerce again. Communication, creativity, transparency, and commitment are the ground rules for the New Normal.
then there will always be Customers for those who can deliver real value quickly, cost-effectively, and with superior quality.
The fact is that we may not make strategic decisions daily, but in a lifetime of developing and executing strategy, I guarantee you that you are exposed to “strategically-relevant” information EVERY day, throughout the day.
Given the current situation, the natural tendency is to turn to the methods that fall under the topic of “Turnaround” or “Restructuring” in an attempt to return a company to prosperity. Even so, I believe we will quickly find that these traditional ways of “fixing” organizations are insufficient. I believe these Restructuring/Turnaround approaches must be modified and evolved to reflect the realities of conducting business in the New Normal. 
Stage 4 – GROWTH – with a going, profitable, concern you are now looking more strategically to the future in terms of markets and offerings. You are addressing questions such as: “Do I have the right offerings and business model for my current market”; “What else can I sell to my current Customers”; “Can I use my offerings or core competencies to expand to other markets” – i.e., generate new Customers. Generally, most of these questions all fall under the auspices of the Ansoff Matrix – which represents an effective framework for identifying growth/risk opportunities (ED: have used this framework dozens and dozens of times to help identify, evaluate, and select growth initiatives for an organization). The final, bottom line “big question” is “What company focus – i.e., “strategy” – will generate the maximum return for the Investors?”
short-term – in the New Normal will require creative ways of using limited capital to conduct business. I fully envision the barter system to be 
Outside of a preacher in a small church, I don’t know of a more lonely calling than a small business owner.